November 22, 2024
Money-Market Fund Assets Crash 'Most Since Lehman' As Bank Deposits Rose Last Week

Money-market funds saw the largest weekly outflow since Lehman (Q3 2008), plunging $99BN...

Source: Bloomberg

The outflows were all from institutional funds (retail funds saw another inflow)...

Source: Bloomberg

Presumably this was driven by tax-extension deadline payments - or else something serious is happening.

Total bank deposits - on a seasonally-adjusted basis - dropped for the second week in a row (-$$8.7BN)...

Source: Bloomberg

Non-seasonally-adjusted, total deposits saw inflows for the 3rd week in a row (+$20.6BN)...

Source: Bloomberg

Is this the start of a major reversal... or just the one-off tax flows?

Source: Bloomberg

Domestically, excluding foreign banks, there were deposit inflows on both an SA and NSA basis...

Source: Bloomberg

Which has narrowed the delta between SA and NSA deposit outflows since SVB to just $38BN (the outflows are still over $200BN total)...

Source: Bloomberg

On the other side of the ledger, bans increased their lending volumes modestly last week - after 2 weeks of shrinkage - op around $9BN...

Source: Bloomberg

The Fed's balance sheet shrank by around $19BN last week, but usage of its emergency funding facility for banks remained at record highs around $109BN...

Source: Bloomberg

Bank reserves at The Fed and US equity market appear to be converging back together...

Source: Bloomberg

The key warning sign continues to trend lower (Small Banks' reserve constraint), supported above the critical level by The Fed's emergency funds (for now).

Source: Bloomberg

Notably above, Large bank cash is surging (as those money-market fund outflows move?) - is it time to sacrifice another small bank for the greater good?

Source: Bloomberg

Finally, if you're wondering why regional banks were clubbed like a baby seal this week... wonder no more...

Source: Bloomberg

They have a $109BN (at least) hole in their balance sheets that needs to be filled by March-ish...

...(and with rates going higher, good luck!)

Tl;dr:...

Tyler Durden Fri, 10/20/2023 - 17:00

Money-market funds saw the largest weekly outflow since Lehman (Q3 2008), plunging $99BN…

Source: Bloomberg

The outflows were all from institutional funds (retail funds saw another inflow)…

Source: Bloomberg

Presumably this was driven by tax-extension deadline payments – or else something serious is happening.

Total bank deposits – on a seasonally-adjusted basis – dropped for the second week in a row (-$$8.7BN)…

Source: Bloomberg

Non-seasonally-adjusted, total deposits saw inflows for the 3rd week in a row (+$20.6BN)…

Source: Bloomberg

Is this the start of a major reversal… or just the one-off tax flows?

Source: Bloomberg

Domestically, excluding foreign banks, there were deposit inflows on both an SA and NSA basis…

Source: Bloomberg

Which has narrowed the delta between SA and NSA deposit outflows since SVB to just $38BN (the outflows are still over $200BN total)…

Source: Bloomberg

On the other side of the ledger, bans increased their lending volumes modestly last week – after 2 weeks of shrinkage – op around $9BN…

Source: Bloomberg

The Fed’s balance sheet shrank by around $19BN last week, but usage of its emergency funding facility for banks remained at record highs around $109BN

Source: Bloomberg

Bank reserves at The Fed and US equity market appear to be converging back together…

Source: Bloomberg

The key warning sign continues to trend lower (Small Banks’ reserve constraint), supported above the critical level by The Fed’s emergency funds (for now).

Source: Bloomberg

Notably above, Large bank cash is surging (as those money-market fund outflows move?) – is it time to sacrifice another small bank for the greater good?

Source: Bloomberg

Finally, if you’re wondering why regional banks were clubbed like a baby seal this week… wonder no more…

Source: Bloomberg

They have a $109BN (at least) hole in their balance sheets that needs to be filled by March-ish…

…(and with rates going higher, good luck!)

Tl;dr:…

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